Microsoft Unleashed a Pandora Killer

Microsoft's Xbox music service is promising, says Jim Cramer. Consider buying the stock on a selloff.

NEW YORK ( TheStreet) -- Wow, Jim. Microsoft is back in music. I'm looking at it and it sounds like this is a Pandora killer it I ever saw one.

Jim Cramer: That's exactly how I viewed it. You know, using Pandora this week, and I have an Xbox and I just kind of felt like, wow. I mean, listen to the Xbox, five million people have it, it looks like Microsoft offering a better alternative than Pandora.

I think that this is not an Apple killer, although, Apple, everything kills the stock these days. Apple stock just wilts constantly. You've got that Apple open down five or three and come back. But I think that Microsoft...you're playing with fire because I can't believe that quarter is that good.

They do have a new product cycle, obviously, in Windows 8. This music initiative is regarded as desperate. I think that's wrong. I think that they have a big installed base.

Debra Borchardt: I think that people miss that Xbox community. They don't understand how strong that community is, how young that community is, and it's like the Apple process of getting into education. They get to these kids that are on the Xbox. Even the young adults are on Xbox Live. You have the music. Get them young.

Jim Cramer: And it's apparently a very good, clean site. We were joking this morning on Squawk on the Street about how Hasbro's numbers are bad. Well, what is going on here? I mean, obviously people are still gaming. They're gaming. And they have Xbox. Xbox is a loved product. People have really decided Microsoft's a bunch of buffoons. In the meantime Skype is great. They don't make any money off it but it is great. Xbox is great and they make a lot of money off of it. Windows 8 people are re-upping.

No one is going to buy anything PC related because PCs are actually in secular decline. You have a one percent a decline. That prefaces, maybe, a 10 percent decline. So Microsoft's a troubled stock. But if they don't miss the quarter big and they are able to blow out the music thing, then you can see a stock that can go up a buck and a half, two bucks. I don't want to buy at the end of the quarter because I think the quarter is going to be bad. But I think a lot of people are going to seize on if it's down even for a minute.

Debra Borchardt: All right, so you think that if Microsoft has a bad quarter, they take a tumble...